Good Neighbors, Good Business Haiyang Li and Anthea Zhang explore how community affects business success By Karen M. Kroll
It has been well known that Silicon Valley is a hotbed of technology innovation and London a global financial hub. Why have other cities and regions fallen well short of achieving the same iconic status? New research by Yan (Anthea) Zhang, associate professor of management, along with her husband and research partner, Haiyang Li, also an associate professor of management, sought to explain why the communities have varying growth rates.
In the Zone During the 1980s, the Chinese government began funding and developing technology zones (clusters) across the country, with the objectives of encouraging entrepreneurship and fostering China’s technological capabilities. Each zone contains several groups of technology firms, organized by the governmental policies and regulations. Industries located within the zones included electronic information, integrated optical and advanced manufacturing, biotech and pharmaceuticals, new materials, new energy, and ocean technology, among others. Driving Li and Zhang’s research was the discovery that, while the technology zones shared a common organizational model, growth rates among them varied dramatically. Case in point: in 1991 the government established both the Shanghai Zone and the Taiyuan Zone in Shanxi province. By 2000, the firms in the Shanghai Zone were generating about 75 billion renminbi (RMB) in total revenues annually, while the companies in the Taiyuan Zone were ringing up about one-tenth that amount. “We were interested in finding out why they had such dramatically different growth rates,” says Zhang. “That was our starting point.”
Associate Professors of Management Haiyang Li and Anthea (Yan) Zhang at Nanchizi nearby Tiananmen Square in Beijing
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